The loose supply of alumina remains unchanged, but futures disturbances intensify, and alumina prices enter a volatile period [SMM Weekly Alumina Review]

SMM News on July 3:

Price Review:

As of Thursday this week, the SMM alumina index stood at 3,112.73 yuan/mt, down 11.94 yuan/mt from Thursday last week. In Shandong, prices were reported at 3,050-3,110 yuan/mt, down 15 yuan/mt from Thursday last week; in Henan, prices were at 3,080-3,120 yuan/mt, unchanged from Thursday last week; in Shanxi, prices were at 3,050-3,110 yuan/mt, down 15 yuan/mt from Thursday last week; in Guangxi, prices were at 3,160-3,200 yuan/mt, down 10 yuan/mt from Thursday last week; in Guizhou, prices were at 3,130-3,230 yuan/mt, down 10 yuan/mt from Thursday last week; and in Bayuquan, prices were at 3,160-3,240 yuan/mt, down 50 yuan/mt from Thursday last week.

Overseas Market:

As of July 3, 2025, the FOB Western Australia alumina price was $361/mt, with an ocean freight rate of $21.80/mt. The USD/CNY selling rate was around 7.18, which translates to a domestic mainstream port selling price of approximately 3,112.73 yuan/mt, 78.47 yuan/mt higher than the domestic alumina price. The alumina import window remained closed. This week, an overseas alumina spot transaction was inquired about, with details as follows:

1. On July 2, 30,000 mt of alumina was traded overseas at a transaction price of $361.6/mt FOB Western Australia, with an August shipment date.

Domestic Market:

According to SMM data, as of Thursday this week, the total installed capacity of metallurgical-grade alumina nationwide was 110.82 million mt/year, with a total operating capacity of 88.63 million mt/year. The weekly operating rate of alumina nationwide decreased by 0.31 percentage points from the previous week to 79.97%. Specifically, the weekly operating rate of alumina in Shandong decreased by 0.31 percentage points from the previous week to 86.24%; in Shanxi, it decreased by 0.4 percentage points from the previous week to 76.60%; in Henan, it remained unchanged from the previous week at 59.17%; and in Guangxi, it decreased by 0.82 percentage points from the previous week to 90.91%.

During the period, alumina futures prices surged, bringing the alumina futures-spot risk-free arbitrage window close to opening. Futures-spot traders were relatively active in inquiries, and spot cargo availability tightened temporarily. Suppliers raised their quotes, leading to sporadic transactions with premiums against the online price.

Overall:

This week, the operating capacity of alumina decreased by 340,000 mt/year to 88.63 million mt/year. In the short term, the operating capacity of alumina is expected to remain high, with only a few manufacturers conducting routine maintenance. The supply in the spot market remains relatively loose, exerting downward pressure on the alumina spot price ceiling. However, with the recent surge in alumina futures prices, it is necessary to closely monitor changes in futures prices and transfer to delivery warehouse demand in the short term. The alumina price may enter a phase of volatile adjustment.

Source: SMM

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